 REASSESSMENT-GATE 2008
First in a series of articles
Bogus Numbers
Last August,’07, a Marion County Reassessment Order was issued, authorizing a correction for the Marion County ’s valuations for the March 1, 2006 assessment date.
An outside service, Manitron, was appointed as the professional company contracted to do this job with the whole process not to cost over the $3 million mandated, and with specific instruction “The County Assessor shall not retain any certified professional appraisers that performed the inadequate assessments in Marion County .” Citing various flaws, the Dept. of Local Government and Finance ordered
“The County Assessor shall reassess all real property in Marion County.”
Did this really take place and how was it done? Did someone really come to your residence, measure the place, acquire updated information and report it? You claim you don’t recall anyone doing that, and you would be correct. But they don’t have to because it was never ordered as “This reassessment shall not require full-scale reassessment activities normally associated with a general reassessment such as physical inspection of every property.” Oh, then what tools did they use to evaluate your residence or your business or your farm? Was much of the work already accepted, based on local Township assessors’ prior flawed results and why were Township assessors involved again? Answer: By Order, “Under the direction and supervision of the County Assessor , the township assessors, contracted certified professional appraisers, or a combination as determined by the County Assessor , shall review and adjust the assessments of all improved residential properties.” Hmm, ‘Review’ the ‘improved.’
Two front page sentences of the order are worth mentioning:
Whereas, it was the statutory responsibility of the township assessors in Marion County to apply the annual adjustment standards of 50 IAC 21 to real property in Marion County ; and
Whereas, township assessors failed to properly apply the annual adjustment rule, leading to grossly inequitable assessments and tax bills;
This begs the question of why the township assessors, considered at this point as non compliant statutory law breakers, were used in any capacity with Manitron.
What if you built an additional bedroom, sun porch or bigger kitchen? Did you tear down a garage? Did anyone factor that? How would anyone know without a tour?
What about foreclosures and the concept of a devaluation of the surrounding homes? It appears that only in the case of an extreme amount of foreclosures in a saturated area could this factor into your assessed valuation.
What about Non-Residential? Figure the value of the land and a cost and sales approach or an income approach in a reconciliation formula followed by a final ratio study. Now you know that business and industrial property is a challenge, takes homework, and is not for the faint of heart for your every day assessor.
This order listed only 2 specific targets on residential: “unimproved residential property assessments in Decatur , Lawrence , Pike, and Warren Townships were below the acceptable range of assessment accuracy required by 50 IAC 21.”
And “The equity of assessments on improved residential property in Center Township was outside the acceptable range required by 50IAC 21.”
The bulk was targeted to improved, unimproved commercial property and vacant land in specific Townships.
Yet, it was supposed to be countywide. A sampling of over 100 homes in a Wayne Township neighborhood, for example, indicated no difference in the new reassessment compared to the flawed assessment. Considering the AV ranged from $80,000.00 to $145,000.00 along one street, what is the mathematical probability that the revised assessment would be 100% identical to last year’s flawed assessment? Were various neighborhoods unaffected with the idea that the original assessors work could be used as a starting point? The order says “Any professional appraisers retained by the County Assessor shall use as much information as already has been compiled by township assessors as is useful in completing the reassessment.” Were many neighborhoods statistically ‘in the range’ and therefore carte blanche accepted?
Restrictions led to Bogus numbers:
Because of a compacted time frame of 4 months to get a job normally taking 12-18 months, and a delay in Marion County’s computer system transferring acceptably to Manitron’s system, certain assumptions of data received by Manatron was used as a given, such as a parcel’s physical characteristics, albeit outdated.
To determine the marketability of a parcel, factors such as sales, depreciation and surrounding area land values were to be considered, but if all Marion County had in their market database was a transactional sale and inconsistent outdated data, then an incomplete picture skews the results. To produce a model and experiment with retrofitting various formulas when relying on outdated physical property data is tantamount to taking a left turn onto a turn-about and traveling in circles on the same potholes.
The Income Factor is another puzzle piece. How much income a car lot, hotel, or apartment complex generates would be of relational importance to its general worth. Mailers were sent out for these businesses to respond with specifics which proved inadequate, so national information was bought and applied to model experiments as a guesstimate of what your local parcel’s income in Indianapolis might be. Again, this is the equilivent to purchasing a nationwide pizza chain sales database and ascribing its worth, sales, and income to your local pizza place. Further, the idea that Marion county and Manitron would accept volunteer results of a straw poll mailing questionnaire begs the lack of legitimacy of conducting a thorough and scientific analysis.
Value of Land was also assumed, albeit insufficient sales numbers data, in the database from 2002 thru 2005. If your parcel was influenced by a flood plain, a McDonalds, or filling station, in 2002, it was accepted as such despite the closure of the restaurant or filling station thereafter which may affect the results.
Commercial and Industrial property throughout Marion County were redrawn and divided into 13 subsections and then subdivided into commercial neighborhoods based on a geologic, environmental and locally shared characteristics, which arguably could be challenged.
None of this answers the question on how your private home was reassessed.
Consider the colossal blunders of requiring Manatron to fast track into a 4 month sprint instead of a reasonable 12-18 months, accepting faulty and insufficient commercial data as a given, inventing various models and scenarios and redistricting neighborhoods based on superficial boundaries, insufficient results from a mailed flyer, and all the approaches with myriad formulas and related influences and ask yourself if the DLGF which approves results is doing it’s own job that “promotes consistent assessing procedures throughout the state…” If this is to be consistent with all 92 counties, Heaven have mercy.
(posted 4-6-08)  From right: Team Hammond Members: Ted Prettyman, Jim Premeske, Patriot Paul, Joe Sturonas. Statehouse HEA 1001 signed by Governor, 3-19-08 Lake County Addicted to Taxes ?
Indiana Property Tax Repeal Alliance member, Team Hammond, received a briefing on HEA 1001 from State Rep. Ed Soliday, R-Valparaiso on 3-25. The Post Tribune picked up the following quotes from Soliday about this 973 page bill:
“ Lake County must stop its addiction to taxes.”
“There’s room in all of these pages for much mischief, and there’s probably only four people on earth who understand what it all means.”
Team Hammond has been vocal about the way excessive government politics are entrenched in northwest Indiana , especially with the excessive amount of indictments and unethical behavior that wraps the area like a cocoon. Coming on the heals of a successful Tea Party Tax Protest held in Crown Point and multiple trips to the Indiana State House, our tax repeal friends were eager for details.
George Janiec of Team Hammond indicated “Knowledge is the strongest and most valuable weapon.”
(posted 3-30-08) Highlights (?) of 2008 Tax Legislation  Property Tax HEA 1001: Passed March 14th by the Indiana Senate 41-6 and the House 82-17,and became law with Governor Daniels’ signature on 3-19-08.
Caps of 1 and ½% for Residential homes in 2009; 1 % in 2010
Caps of 2 and ½% for Farms and Apartments in 2009; 2% in 2010
Caps of 3 and ½% for Business property in 2009; 3% in 2010
State Sales Tax hiked from 6% to 7% effective 4-01-08
Seniors: Tax bill limits increases to 2% for a single senior making up to 30,000.00 (40,000 if joint), when home value is below 160,000.00
Renters: Deduction from 2,500.00 to 3,000.00
Homestead Credits: $620 million additional for 2008, $140 million in 2009, and $80 million in 2010. Increases standard deduction for homeowners from the lesser of $45,000 or 50% of assessed value to the lesser of $45,000 or 60% of assessed value.
Lower income tax citizens receive earned income credit hikes from 6% to 9%
Assessors: Reduced from 1,100 to 92 county assessors and 42 township assessors. Referenda will be held in November in the 42 with more than 15,000 parcels on whether to cede into a county assessor.
Schools: Referendum required for elementary and middle school projects over $10 million and for high schools over $20 million
$120 million allocated for schools for 2009 and 2010 as transition money along with rainy day increases.
Government projects: Referendum required for projects over $12 million.
Distressed Unit Appeals Board: Taxing units facing a shortfall more than 5% decreases can appeal to this board.
2 counties: Lake and St. Joseph will be treated differently. Due to the extent of their debt, caps will be slightly over 1% of assessed value, depending on the township. These 2 counties are exempted until 2019 from caps on revenue used to pay existing debt.
Constitutional plan: 1st step initiated to allow legislatures and voters the process toward putting ‘caps’ into the Constitution
Governor Daniels’ indicated a ‘new era of taxpayer protection. No longer will taxpayers be asked to adjust their tax bills to government’s appetite. Instead, government will now need to adjust its spending to what taxpayers can reasonably afford. This is a huge step toward making Indiana the best place in America to own a home or business.” (Statehouse Rotunda, 3-19-08) (posted 3-25-08)
| INITIAL REACTION
As people start to view on-line their assessed value, reports of atrocious and inequitable values are mounting. Reaction from the Marion County Assessor, Greg Bowes: “We still have problems. There was too little time, frankly, to get everything done perfectly. This is really something that should have taken a year, but we have teachers and policemen to pay. We need to get this done,” as reported the Indianapolis Business Journal.
Did this rush to judgment day burden the process even further? Marion County must now ask the bond bank to borrow money with interests to make our financial obligations. On March 18th, Channel 13 quotes Mayor Ballard “We have to go borrow the money so we can pay the day to day expenses and then we have to pay interest on that.”
Secondly, word of new appeal applications added to the thousands from last year has yet to be heard from outraged citizens. Indiana Assessors Association President, Becky Williams: “I believe we’re going to be absolutely buried in appeals, and it’s going to cost this county severely. The commissioner of the DLGF should have known they could not do this in four months. Manatron in their own overview stated a project of this type normally takes up to 18 months. I think that pretty much says it all.” (IBJ 3-18).
The Indianapolis Star quotes Senator Pat Miller, R-Indianapolis, 3-18, “I don’t think assessors are the problem. The bottom line is, I think assessing is the problem.”
Referring to HEA1001, Rep.Cindy Noe’s email on 3-14 indicates “This plan doesn’t take the kind of bold steps needed to adequately reform the Dept. of Local Government finance and our assessment system.”
Broad Ripple resident, Maurice Gunyon emails:
"I have a duplex here in Broad Ripple. I live in one side and lease the other side. Is this owned or rental? This bill (1001) is bull- all smoke and mirrors. And certainly not any kind of tax relief. Just wait until that ‘reconciled’ third payment hits in late April/early May. Folks, we still have a lot to do. The ‘Washington Street Rocket Scientists Club’ is still telling us that we are dupes and they can do whatever they want. That 1-2-3 % cap means nothing if the levies and assessments are not controlled and this bill does not control either.”
One of the many conclusions of this flawed reassessment was the selective targeting of commercial and industrial property, vacant property, and including improved and unimproved residential property located in targeted counties of Decatur, Lawrence, Pike, Warren and Center townships, despite the reassessment order as countywide: “The County Assessor shall reassess all real property in Marion County..." (posted 4-6-08)
Louisville Columnist Shares Historical Viewpoint on Property Tax Legislation
Lesley Stedman Weidenbener
Lesley Stedman Weidenbener’s column appears in Louisville Courier-Journal (3-23) and well worth reading her perspective from a historical viewpoint with this excerpt:
“ Indianapolis – It was 2002 the last time the General Assembly increased the sales Tax to cut property taxes. Back then, homeowners were about to be hit by increases in their bills and lawmakers were trying to head off what they feared would be a revolt by their constituents.
The sales tax went from 5 percent to 6 percent and the take hikes were mitigated. That’s right: Mitigated. It’s not the kind of word that get lawmakers re-elected. The truth is, because the big tax bills hadn’t hit homeowners yet, they didn’t realize how big their savings really were. To top it off, tax bills kept climbing, due in part to other changes the legislature made in 2002 and in subsequent years and in part to new local spending.
So then comes the property tax crisis of 2007. This time, tax bills did go up and lawmakers were put into a defensive—rather than offensive—position. And they acted. Under legislation that Gov.Mitch Daniels signed into law last week, homeowners’ tax bills will be an average of 30 percent lower this year than last. By 2010, bills will still be lower than they were last year.
Supporters say this law has safeguards that should keep bills from growing out of control again so quickly, which is why they’ve used words like “permanent” and “lasting” to describe the relief.
Also, the State’s economy had stagnated and the legislation reworked the state’s business tax system (in part by eliminating the property tax on inventory, something that contributed to the 2007 increases for homeowners) to try to lure more jobs to Indiana .
So with that background, here is the start of the 2002 story on the morning after the bill passed:
“The state House and Senate have approved the most comprehensive tax-increase and restructuring program in Indiana history will a bill meant to begin digging the state out of its worst budget crisis in more than two decades. Last night Gov. Frank O’Bannon described the bill as ‘monumental’ and said he will sign it into law as soon as possible.”
A little dramatic? I think it is in hindsight, anyway. At least I didn’t use the words like “permanent” to describe the tax relief. Still I did go on to quote legislative leaders describing the legislation as ‘historic.’
Sound familiar? But I don’t think it will surprise lawmakers to learn that – probably like many of their constituents- I’m going to reserve judgment on this new plan, at least for a few more years.”
S.T.O.P.Indiana’s comment:
Lesley Weidenbener definitely notices the similarity and the hype surrounding these tax reforms separated 6 years apart. She wrote about both. Unfortunately, we do not have years for a wait and see reaction. Look where it has gotten us now- 6 additional years of homeowner pain, street protests and foreclosures. While some reform portions are praiseworthy, this 2008 Swiss cheese legislation has enough mischievous holes for schools and local governments to find relief. Why do you think it took 3 months for lawmakers and special interests to design it that way!
Property Tax Repeal Advocate Speaks Out
Rex Bell, a resident of Hagerstown , In. and property repeal advocate, wrote an article appearing in the Richmond paper, Palladium. Here are some excerpts:
“Our state legislature just spent three months wrestling with the property tax mess, and you certainly have to give them credit for being creative. Their goal was to quiet the public outcry over sharply increased property tax bills, and they may have achieved that goal among some property taxpayers, if only temporarily.
In spite of their efforts, our officials have failed with the current legislation to make property taxes equal, and regardless of any changes that might be made, they can never make property taxes fair. They are, by nature, a confiscatory tax.
Even in the unlikely event that the legislature would agree to tax all property evenly, we could never escape the fact that if a person became unable to pay the taxes on their home, the government could seize their home and auction it off to the highest bidder.
Governor Daniels has said this new legislation will make Indiana America’s best place to own a home or business. If we really want to do that, we need to ELIMINATE property taxes altogether.”
(posted 3-25-08)
"The only thing necessary for the triumph of evil is for good people to do nothing." - Edmund Burke The Word on the Street... The following information is credited from recognized published online news accounts and comments received by email. Bauer, D-South Bend: “This bill does cut property tax bill dramatically” (Statehouse Rotunda, 3-19)
Sen. Sue Landske, R-Cedar Lake , referring to Lake County “Without that (debt) exclusion, I’m afraid a lot of our taxing units would have been bankrupt, and not everyone realized that. I think ( Lake County taxpayers) are going to be very pleased. (nwi Times, 3-20)
Sen. David Long, R: “This is a really great day for all of us. We should feel very good about being Hoosiers. We’re doing things in Indiana that other states only wish they could. We have given them true reform and a true tax break.” (Statehouse 3-19)
Sen. Luke Kenly: Referring to referenda, “If people have objections or concerns, there has to be public meetings. The main thing is transparency, public access. That’s the key.” ( Evansville Courier, 3-20)
Patriot Paul: It also represents a historical blunder, because this bill does nothing to remove the annual possibility of every family being evicted for failure to pay into an unfair and broken system.” (AP Chicago Tribune, 3-19)
Fran Dupey, Commissioner, D-Hammond: “I think it’s time to walk around the state of Indiana government and appease our constituents.” (Post Tribune, 3-20)
Rep. Craig Fry, D-Mishawaka: “blatantly unconstitutional” , “the largest tax increase in the history of the state.”
Sen. Timothy Skinner, D-Terre Haute: “middle-income people are not going to get a tax decrease at all.”
Rep. Ryan Dvorak, D-South Bend: “I really hoped we’d be able to do better this year, but unfortunately we all know we’ll be back here next year fixing this all over again. I hope one of these years we can get this right.”
Sen. Lindel Hume, D-Princeton: “Here we are today with this black-and-white striped animal that still smells like a skunk. I’m sorry but this is not true, lasting substantial property tax relief.”
Bill Crawford, D-Indianapolis: “Maybe it’s not perfect, but we’re giving them reform. It’s a compromise.”
Sen. Karen Tallian, D-Portage: “This is a micromanagement of a tax program that may or may not work.” The language is inconsistent with the Constitution’s ’simple, elegant document.”
Sen. Frank Mrvan, D-Hammond: “the language to me, I don’t care what it says, so long as it does the job.”
Rep. Charlie Brown, D-Gary: “Gary will be devastated, the school system, the library, the sanitary district. That’s terrible.”
Sen. Earline Rogers, D-Gary: I would have liked to do more than just get people through the next election.”
House Speaker Bauer, D-South Bend: “This bill is far from perfect, but it accomplishes substantial property tax relief.” (posted 3-18-08)
Upcoming Events and Activities
Coming Spring 2008 (if they get them out in time)
The Reconciliation or "Gotcha" tax bill!
Marion County taxpayers will be forced to pay an upcharge
or "reconciliation" bill. A shotgun assessment based on what standard, exactly? Constitution?
Tuesday, May 6, 2008
First Cut: Referenda / taxpayer / repeal / citizen-friendly candidates
Statewide: Primary Election
Tuesday, November 4, 2008
Final Cut: Referenda / taxpayer / repeal / citizen-friendly leaders
Statewide, National: Election
People Speak Out About Predatory and
Unconstitutional Property Tax Increases 
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